The dirty secret of climate change

Amid all the complex data and opinion about climate change, the dirty secret is quite obvious, so simple and awkward that it's rarely discussed. The dirty secret is that, under present conditions, at least in the short-term, alternative energy costs more than fossil fuels.

Perhaps some unforeseen technological development will give us safe energy that is cheaper (in terms of lifetime costs) than coal, oil or natural gas; but meanwhile we continue emitting greenhouse gases, and have no clear prospect for making a rapid transition.

One way to give alternatives a chance would be to put a price on carbon dioxide and other greenhouse gases. This has been known for many years. For example, a fee (or let's be frank and call it a tax) could simply be imposed at the point when dangerous fuel comes out of the ground or is imported. The tax would have to be substantial enough to make alternatives attractive, but not so much as to choke off a declining, but necessary use of fossil fuels during the transition.

The money could be variously used. Part of the money could be used to pay down the national debt. Or sent to low-income people who simply couldn't pay higher fuel bills for minimal use while continuing to eat, send rent, buy clothing. Or used to support research on alternative forms of energy. Or some combination of these. One proposal would even distribute all he money as a per capita dividend to adult citizens, in effect giving a reward for low use of dangerous fuel.

Let's be clear: if energy were to cost more, then consumers will either use less or become more efficient at using it, or have less money to buy other things (or some combination).

We can't wait for politicians to act. They are terrified to impose costs for which voters can blame them, unlike the enormous costs of price inflation that seems to be nobody's fault, or unlike costs that are "traditional," such as subsidies. We can't expect the suppliers of fossil fuels to act on behalf of the community; they are in business to make a profit, and like tobacco firms before them, will use their cash flow to spread disinformation to defend their economic interests, as in promoting a fantasy called "clean coal."

We need to pay more for energy. It's that simple. Why? We've discovered that the fossil fuels that built our civilization emit gases that are dangerous. It would be nice if this weren't true, nice if we could safely use all of even most of the reserves already known. But we can't.

This is awkward for certain companies, the economic value of which is determined not only by their infrastructure and customer bases, but also by their reserves. It is awkward for all of us users of fossil fuels because it challenges the myth of eternal economic progress.

Economists have a technical term called "externalities," which in common language could be defined as costs paid by someone other than the seller or the buyer (in his or her role as consumer). An externality might be an appropriation of some "commons," such as releasing toxic waste into a river, or emitting greenhouse gases into the atmosphere.

The true price of gasoline would include the subsidies given to fossil fuel firms, the military costs of adventures in oil-rich areas, the health costs of burning fossil fuels, and the long-term effect on the atmosphere in terms of climate change. In other words, far from being a "free market," the price of gasoline excludes hidden costs. The artificially low price of gasoline distorts the market, leading to a much higher use of the product than would occur in an actually free market that took account of the externalities and subsidies.

Putting a price on greenhouse gases emitted by a source of fuel, if that price were high enough, would help make safe sources of energy competitive. This wouldn't be the first time wise citizens have assumed a responsibility toward the future. For example, setting aside a big swatch of Manhattan (or San Francisco or Boston or many other cities) as a park meant apartments couldn't be built there. Similarly, sponsoring the predecessor to the internet, as the federal government did, cost money, but life without the internet is not easily imaginable today.

The myth of the free market says or implies that the market can handle any problem: let firms compete, let consumers decide what to buy. It sounds good. But the market, brilliant as it is at some tasks, can't do everything, and market fundamentalists make the basic error of assuming that a good mechanism must be suitable for all tasks. It isn't. Sometimes there's insufficient demand for a good or service; it needs to be demonstrated or proven, after which the demand might be huge. Sometimes the good requires a sacrifice, which must be fairly shared: we sacrifice now for a good to be enjoyed later, or an evil to be avoided.

Climate change cannot be totally avoided. What we can do now is avoid even worse damage than would be caused by business as usual. The damage already in the pipeline will demonstrate the wisdom of having avoided worse. I imagine a meeting a quarter century from now. Speakers are extolling the wisdom of people alive in 2013, who didn't have to risk their lives in a world war, but who imposed a tax on themselves to limit the damage.

In the citizen diplomacy movement leading up to the end of the Cold War, activists used to say, "when the people lead, leaders will follow." Like all slogans, this one needs qualification, but its truth is clear: we can't wait for leaders to get beyond systems they have created, or systems of which most people still approve. In the case of climate change, the system is the fossil fuel around which we've built our lives but which turns out to emit, over the years, invisibly, a fatal flaw.

Great ingenuity has already gone into ways of lessening our dependence on fossil fuels, but these ways cost somewhat more than what they replace. Even more ingenuity would flow into alternatives if they were competitive with inherently dangerous fuels.

Ordinarily people quickly dismiss putting a price on fuels that emit greenhouse gas, saying this is "politically impossible." Well, so was the end of the Cold War, but it happened. So were voting rights for the progeny of slaves, or for women, but these changes happened. Some things are impossible, but many things seem impossible only until they are done.

Of course we have to deal with the problem of "free riders," of people who are happy to see other people do the right thing while they take advantage of the situation. This would happens within a nation, which is why we need Federal laws, and it would happen among nations, which is why we need a treaty, sponsored by a rich and powerful country that has decided to do the right thing in the context of not allowing its domestic industry to be disadvantaged by other countries using fossil fuels freely.

These types of arguments will not surprise readers who have spelunked the mammoth archives of Joe Romm's site or, in audio, Alex Smith's indispensable Radio Ecoshock; but sometimes it's useful to return to the simple core of the situation. Ordinary people aren't hopelessly ill-informed or stupid; we're waiting for a call for necessary sacrifice, a call that's simple, clear and fair.

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